THE economy in 2020 was affected by Covid-19 pandemic, and projected to contract by 4.5 per cent while nearly 100,000 people lost jobs since the start of movement control order (MCO).
As for food economy, disruptions in the food chain are minimal as food supply has been adequate and markets stable. We were able to keep food supply chains alive and mitigate the pandemic's impacts across the food supply chain system.
But, at the household level, especially the bottom B40, the impacts of the pandemic have an increasingly debilitating effect on their ability to buy healthy and affordable food, particularly households that spend up to 70 per cent income on food.
In 2021, there is no room for complacency. At the global level, it is predicted another 135 million people could face acute food insecurity by the first half of 2021.
Frailties in the production and supply of food could be further exacerbated by the potential for weather-related shocks, millions of jobs being impacted across the agricultural value chain, resultant food price spikes and financial losses impacting on hundreds of thousands of small and medium-sized local organisations that are critical to the integrity of food supply chains across the world.
In short term, what is important is that to continue to closely monitor food prices and strengthen market supervision, ensure effective delivery of agricultural inputs including feed, smooth logistical operations of regional agricultural and food supply chains, and the smooth flow of trade while making full use of the international market to secure food supply and demand.
In the medium term, to ensure better food security preparedness in case of another pandemic or other major catastrophes where several initiatives can be considered:
1. Farmers must have continuous access to the market. Efforts need to be intensified through a combination of private market and government procurement;
2. Ensure the supply of agricultural inputs such as seeds, fertilisers and livestock feed are not interrupted to ensure continuous food production;
3. Ensure adequate storage of food stocks in the event of an emergency;
4. For consumers whose livelihoods are cut off due to MCO, ensure continuous livelihood assistance especially among the urban poor who do not have a permanent job; and
5. Incentivise and support the digitisation of food business supply chain from farms to consumers. Digitization will help reduce the need of migrant labourers.
In the long term, beyond the pandemic, initiatives need to be implemented to ensure the country's food security. A success factor of the industrial crops is the private sector involvement and the co-existence of estates plantation with smallholders. The estate subsector is largely comprised of privately-owned plantations with modern technology.
This successful model need to be emulated in the food production where large farms which is private sector led co-exist with the smallholder farm units. This calls for:
A. Entrepreneurship - food production has not yet been practiced as an industrial crop. Thus it requires agroentrepreneurs who can practice commercial and high-tech food production;
B. Innovation and investment in agricultural system technology will play an important role in fostering agricultural productivity. Thus, the food production sector needs to develop, use various technologies and farming concept of smart farming.
Examples of these technologies, include soil and water sensors, weather detection, satellite imaging, automation, vertical farming, artificial intelligence, nanotechnology, applications GPS, robots, and precise farming;
C. Promoting climate-smart farming – climate change increases the risk of crop-yield, livestock-raising, and fisheries. Thus, the challenge is to achieve sustainable agricultural development for food security under climate change; and
D. Rapid urbanization has attracted poverty and food security issues as urban dwellers are buyers of clean food and rely on income to access foo
d. Promoting urban agriculture will reduce household food spending and increase food supplies.
The role of the government is to foster an enabling environment for private sector investment by corporate investors in food production and work together with smallholder farmers as in industrial crops.
Government investment in essential public goods and services (such as advisory services, productivity-enhancing research, supply chain development, human resource development in entrepreneurship, and social safety net) is a fundamental part of the enabling environment.
To stimulate investment, incentives to the private sector must be formulated so that return in investment in food production is at par with industrial crops, such as oil palm investment. This can be encouraged through appropriate domestic resource mobilisation initiatives and fiscal policies.
The writer is a Professor at the Faculty of Agriculture, Universiti Putra Malaysia